Softening house market?

http://daft.ie/report/ronan-lyons-2022q1-dafthouseprice

Sobering reading.

House prices have risen nationally every quarter for the past seven. Still a massive undersupply of houses, new and second hand.

There won't be much softening until we get more supply, which could be years away.

Inflation in rental costs will push more towards buying.

Ukraine likely won't have much impact on people's decision to buy.

Saw a house near me reduce in asking price by 20k today. First time I’ve seen a reduction in years. It’s crazy out there.

You might see more of these. Houses it seems are being priced at a little under expected sale price in general. Sometimes though im sure the vendor will overshoot and price it so high as to just drive away any interested viewers and will have to reduce to get them interested in looking. After that I guess it depends on the value they feel the house is worth after viewing.

Its very possible that if you keep an eye on that house it may still sell over the original asking price. Or maybe they have totally overshot in their estimation of its value. It doesnt mean tyhe house is worth any more or less than it is worth.

Not seen any evidence of that. All properties I know of nationwide currently, have gone sale agreed almost immediately for well above asking price.

Property prices havent increased in a decade and a half :)

The big difference between now and then is that the banks arent going crazy.

Other things might be happening that could drag it back, such as tech salaries softening. But this is more marginal than the banking issue.

We will never get the supply of houses that they are talking about achieving. It won't happen.

House prices might not rise to much more but they certainly won't drop.

It's a totally different market to the Celtic Tiger era. No 110 percent mortgages with the new car sitting in the drive etc. The bank and thus the taxpayer aren't as exposed it things go tits up this time.

Lets not forget that the arrears crisis is still with us with a lot of people still not paying back the full amount per month and have tens of thousands of arrears on their balance.

The cost of everything s going up but it isn't being matched by a rise in salaries.

Point out where I said "bottom out"

thin skin

Based on what we know of the root causes behind the rise yes I think it will only go up for the medium term. I don't think they will keep rising at the rates they have been but I don't see a massive crash though, In saying that if building materials and the costs of construction in general keep rising , not matched by wages then people in turn might not be able to afford to build. It's a hard one to predict that.

The arse didnt fall out prices declined over 4 years that is hardly the arse falling out. There were still sales going on in those 4 years and the fact that the banks stopped lending stopped a lot of people from buying in that period also.

ECB rates will be at 1.5-1.75 by September next year (looking at euribor futures and interest rate swaps), this will put about 2% onto interest rates here. It should seriously affect the amount people will be able to borrow. In my opinion, we will see house price drops once that kicks in. As to the OP, it can be good to keep on eye on thing like numbers turning up at open viewings etc to see where the market is going.

I'd agree with this, when we were looking in 2011 we went to open days where we were the only ones turning up. Some estate agents at the time told us they were not doing open days, just by appointment only- at the time we assumed that was because nobody was turning up to the open day on some houses.

The crash happened because of credit tightening, this time tight supply is keeping prices raised, maybe the so called "soft landing" is actually going to happen this time.

Frankly I'd rather prices dropped as we are now trapped pretty much in a home we have largely outgrown as the cost of trading up has now increased too. Our neighbour is selling up for the same reason though he is moving to the countryside where he has family so will get more bang for his money.

Right, in terms of viewings etc. I just mention it because during the crash the last time, I timed buying by reading the property pin where bears were turning bullish and there were people saying a noticeable change in numbers turning up at viewings etc. This was end of 2012 and I started looking then, buying about 5 months later.

If yuo are employed and onb over 40k a year SF consider you well off. In saying that FFG have directly contributed to generation rent and removed done nothing to give young workers the chance to own a property. So it might be time to try something different.

Again. I never mentioned prices. Don't be focused solely on prices. The arse fell out of the market. If you want to focus on prices, consider than many people were recent buyers using 100% mortgages. Government policy, and reluctance of banks to crystalize losses, prevented a rapid realisation of reality.

The reason prices did continue to fall was that very few wanted to buy at that stage. Commercial transactions were faster to be realised. I had a distant relation that sold property for a couple of million who was offered it back by Nama for less than 10% of what he received for it. Unfortunately he didn't have the money to buy it back but those stories are not uncommon. I'm aware of another man who sold land for development at the height. Bought it back for a fraction, then sold it again a couple of years ago. Not a property developer - just a farmer who got lucky with rezoning, then had the cash to buy it back, then got offered money he couldn't refuse to sell it again!

Not sure what can be done. I'd love to see rather than cut in income tax in the future is a cut in the USC.

Is there a space between 'soft landing' and 'arse falling out' or does everything have to be hyperbolic?

Drama Driven Development

Humans are suckers for Drama.

Money has nothing to do with the lack of houses being built in Ireland. There is plenty of money available and anyone buying is using their own money via a mortgage. The reason we have a housing issue and why supply is low right now has to do with 1. planning and 2. available workforce to build these houses. There is a huge demand and the market wants to fill that gap but it has just been too difficult to build due to this bs.

I bet that many rushing to buy now at inflated prices will be underwater in a few years as the supply eventually starts to catch up and as many new planning rules start to come into effect. When you drive in and out of any town in Ireland right now you are seeing homes being built absolutely everywhere with 35,000 being built (not enough I know) in 2022 as we need to ramp up to 50k new homes per year for the coming years. I believe this will happen even with bs planning and objection issues however it is happing too slowly for many, unfortunately. What we do know is that once supply catches up then prices will drop as there will be proper competition in the market. I bought in late 2019 but if I hadn't and was still on the market now for a home would probably try to hold out for another 12-24 months. A hard decision I know as we all want the security of a home we can call our own.

Unusual choice of words from an Estate Agents in a local news magazine today...

Of course money is the biggest issue the government have 3 ways of getting money and your talking billions (money so it does actually matter unless you think we have a magic money tree out the back) a year over maybe 2 decades to catch up and keep up with the emigration inward numbers. So money does matter as you will be robbing Peter to pay Paul

Three ways for the government to finance what you want.

Cutting services - they have already been cut to shreds and are already p1ss poor for the amount of taxes paid.

More taxes - Income tax is already one of the most progressive regimes in the world. Maybe a different tax??

More borrowing - With rising interest rates we will be paying billions just on the interest of our existing 250Billion borrowing. We cannot continue to borrow on the never never for every 1% we go up in interest rates that 2.5 Billion less we have to spend or find in addtional taxation and already a lot of experts are expecting us to be up at near 2% by the end of next year so either we stop or it will be our kids and grand kids paying and considering they will already find it near to impossible to buy a house and will be asked to retire at 70 I dont think its fair we kick this can continuously down the road.

Planning and skilled labour shortages are a problem but the biggest issue has been the fact that the government have not had the money to build social housing over the last decade and a half as we have been running an annual deficit of what we take in with taxes versus what we pay out and the difference has been borrowed social housing was cut out of government spending and now the deficit of social housing is being met by government competing in both the rental and buying of property with the bog standard punter trying to buy or rent a 3 bed semi d in a burb somewhere.

i think you might be confusing what the bottom dropping out of the market means

it means sales dropped off a cliff, this is accurate

not that prices did